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Economy in Brief

U.S. Personal Income Increase Remains Firm
by Tom Moeller  November 8, 2013

Personal income in September increased 0.5% (3.7% y/y) following a 0.5% August rise. The gain beat expectations for a 0.3% increase. It reflected outsized increases of 1.9% (12.2% y/y) in proprietors income and 1.1% (10.3% y/y) in rental incomes. Wages and salaries rose a moderate 0.4% (3.0% y/y). Personal dividend income increased 0.6% (9.6% y/y) while transfer receipts edged up 0.2% (3.8% y/y). Personal interest earnings notched 0.2% lower (+4.0% y/y) for the third straight month. Disposable income increased 0.5% (2.9% y/y) and, when adjusted for inflation, went up by 0.4% (2.0% y/y).

Personal consumption expenditures matched expectations and improved 0.2% (2.7% y/y) last month, down from a 0.3% August rise. Motor vehicle purchases fell 3.6% (+2.7% y/y) and spending on clothing edged 0.5% lower (+1.4% y/y). These declines were countered by a 0.1% uptick (4.4% y/y) in spending on furniture and a 0.3% rise (2.9% y/y) in outlays on services.

The personal savings rate moved up to 4.9%, its highest level since December. The total value of personal savings increased 6.4% during the last twelve months.

The PCE chain price index in September inched 0.1% higher (1.2% y/y) for the third straight month. Durable goods prices were unchanged (-1.8% y/y) while prices for nondurables also were unchanged (-0.6% y/y). Services prices ticked up 0.1% (1.9% y/y). Less food & energy, the chain price index rose 0.1% (1.2% y/y) for the third consecutive month.

The personal income & consumption figures are available in Haver's USECON and USNA databases. The consensus expectation figure is in the AS1REPNA database.

Personal Income & Outlays (%) Sep Aug Jul Y/Y 2012 2011 2010
Personal Income 0.5 0.5 0.2 3.7 4.2 6.1 2.9
  Wages & Salaries 0.4 0.5 -0.3 3.0 4.3 4.1 2.0
Disposable Personal Income 0.5 0.5 0.3 2.9 3.9 4.8 2.8
Personal Consumption Expenditures 0.2 0.3 0.1 2.7 4.1 5.0 3.8
Personal Saving Rate 4.9 4.7 4.6 4.8
(Sep'12)
5.6 5.7 5.6
PCE Chain Price Index 0.1 0.1 0.1 0.9 1.8 2.4 1.7
  Less Food & Energy 0.1 0.1 0.1 1.2 1.7 1.4 1.3
Real Disposable Income 0.4 0.4 0.2 2.0 1.7 2.4 1.1
Real Personal Consumption Expenditures 0.1 0.2 0.0 1.7 2.2 2.5 2.0
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